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The collapse of U.K. construction and services giant Carillion in Britain is a lesson that all levels of government in Canada should study closely.

Controversy over operations of its Canadian subsidiary, particularly highway maintenance on behalf of the Ontario Ministry of Transportation, has been obscured by soothing words from politicians. But it’s increasingly clear substandard performance from the private-sector contractors and partners can no longer be ignored when Canada is about to embark on a historic infrastructure building boom.

Much of this will be predicated on public-private partnerships, often called P3 or alternate financing and procurement (AFP) plans. The newly formed Canadian Infrastructure Bank (CIB) is mandated to achieve the best balance of public (taxpayer) money and private investment in large projects that could provide Canadians with, among other things, improved mobility options, municipal facilities and health services.

Such things are necessary if Canada is to remain a modern and progressive country with an excellent quality of life for most of its peoples. It suits government because most of the eye-watering cost of building large and necessary infrastructure projects can be kept off the public books and therefore not add significantly to government debt levels. Private capital, which we are assured is plentiful, can be used instead.

The euphoria of public-private partnerships needs to be countered by understanding they can add considerably to capital and operating costs of projects. Private-sector investors demand reward for putting their money at risk and usually encounter higher financing costs than governments. So, there’s no free money, only favourable optics.

The U.K. has embraced P3 and AFP projects with gusto based on the ideology of an earlier prime minister, Margaret Thatcher, and propagated by subsequent leaders believing that private sector “efficiencies” and risk tolerance can build infrastructure and provide public services at lower cost than the government. It also suits the right-wing mantra that smaller government is better.

But the U.K. has many examples, including the collapse of Carillion, where public-private partnerships have been ill-conceived, and accountability has often been over-written by ideology, cronyism, entrepreneurial opportunism and politicians’ willful blindness.

A search of the British press provides a quick study of many instances where outsourcing and privatization have failed, miserably. Much touted savings and efficiencies morphed into poor contractual performance, business failure and huge bills for taxpayers who were previously assured of savings, more choice and better service.

One would hope, therefore, that P3 or AFP financing of major Canadian infrastructure projects, whether financed through CIB or awarded directly by governments will be evidence-based and performance-focused.

Ontario has had successful examples of these, including several transit projects in Toronto. But the Carillion issue proves that extreme diligence on contract terms and careful assessment of the strengths and motives of private partners are required.

From a governmental standpoint, the five-ton gorillas in Canada’s infrastructure plans are politics and absence of policy. They have lethal potential and are the primary reasons we have a dysfunctional public transportation system, needed pipelines that don’t get built and creaky hydro and water infrastructure. And they are likely the greatest threats to the shared success of future infrastructure investments.

Inappropriate political meddling comes in many forms — anything from a local councillor not supporting a project because it doesn’t benefit their riding to pressure from special interest groups to blatant attempts at vote-buying at the party level. Look at any failed public-private partnership and political interference will be one of several possible smoking guns.

As the CIB starts looking at funding opportunities, it needs to bar political interference. Perhaps easier said than done. But projects must be merit-based for the broader community, driven by evidence and demonstrated need, and based on longer-term policy rather than the current ad-hoc approach.

They must be costed on a totally-absorbed basis with an exit path if early planning and design signify previously hidden technical and commercial impediments.

And the allocation of risk must be clear from the outset. This can only be accomplished if the private-sector partner is robust in terms of experience and financial strength.

The Carillion failure and its resultant heavy cost to British taxpayers was caused, in part, by the government awarding it contracts when it was allegedly financially unsound. It seems to be a case of willful political blindness, or perhaps that and something even more sinister.

As we continue to build our country we have the right to expect astute public investment decisions based on sound policies and evidence, not election cycles and special interests. Whether this is possible remains to be seen.